SJ reports 25% increase in six months profit attributable to shareholders

For the six months ended June 30, 2022:

Sagicor Group Jamaica Limited (SJ) for the six months ended June 30, 2022, reported a decrease in total revenues by 3% to $46.88 billion from $48.19 billion in 2021. ​Total revenue is broken down as follows:

• • Net premium revenue rose by 4% to close at $26.66 billion compared to $25.51 billion documented 2021.
  • Net investment income increased to $10.78 billion from $9.34 billion in 2021.

• • Realized capital loss closed at $2.22 billion versus 2021’s gain of $3.79 billion.
  • Credit losses on loans and investments securities amounted to $210.32 million, when compared to 2021​’s $219.31 million.

• • Fees and other income increased 5% to $8.33 billion (2021: $7.91 billion).
  • Hotel revenue of $3.55 billion was booked for the period relative to $1.87 billion for the prior year.

Benefits and expenses totalled $38.39 billion for the period, a year over year decrease of 7% from $41.19 billion. The movement in benefits and expenses was mainly driven by:

• • Administration expenses for the period amounted to $13.82 billion compared to $11.52 billion in the prior year, a 20% increase.

• • A 13% increase in net insurance benefits incurred to $18.71 billion (2021: $16.57 billion).

• • Commission and related expenses rose by 4% to close at $3.72 billion up from the $3.57 billion posted in 2021.

• • Depreciation and amortization amounted to $1.42 billion (2021: $1.34 billion), a 6% increase.

• • Other taxes and levies moved up by 8% to close at $882.6 million in 2022 from $820.61 million in 2021.

• • SJ also booked hotel expenses, which went up by 76% to close at $2.53 billion relative to $1.43 billion booked the prior year.

• • Net movement in actuarial liabilities amounted to $2.68 billion relative to an actuarial benefit of $5.95 billion booked in 2021.

Share of profit from joint venture amounted to $343.69 million relative to a profit of $496.19 million the prior year.

Profit before taxation amounted to $8.83 billion, a 21% increase when compared to the $7.27 billion booked in 2021.

After taxes of $2.61 billion (2021: $1.98 billion), net profit amounted to $6.22 billion (2021: $5.29 billion), an increase of 18%. For the quarter, net profit closed at $2.20 billion (2021: $2.39 billion).

Profit attributable to shareholders amounted to $6.04 billion relative to $4.85 billion booked in 2021. Net profit attributable to shareholders for the quarter closed at $2.22 billion (2021: $1.94 billion). As a result, EPS for the six months amounted to $1.55 (2021: $1.24), for the quarter, EPS amounted to $0.57 (2021: $0.50). While the twelve-month trailing EPS totalled $4.76. The number of shares used in our calculations amounted to 3,905,634,918 units. SJ’s stock price closed on August 12, 2022, at $54.50 with a corresponding P/E of 11.45 times.

Management advised that “Net premium income of $26.66 billion grew by 4% over the prior year, as a result of strong new business sales and policy retention. Net investment income amounted to $10.78 billion, a 15% increase over the prior year, emanating from growth in the Group’s interest-earning asset base. Fees and other income were aided by an increase in corporate and domestic spending as well as other commercial banking activities, ending 5% higher than the prior year”

Management also stated that, “The Group’s recent acquisition, Alliance Financial Services Limited, has had a successful return to full operation and is showing encouraging revenue growth in its remittance and cambio segments.”

Balance Sheet at a glance:

Total assets increased by 1% or $6.44 billion to close at $513.97 billion as at June 30, 2022, from $507.53 billion the year prior. The main contributors to the increase in total assets were ‘Deferred income taxes’, ‘Loans & Leases after Allowance for Credit Losses’ and ‘Other Assets’ which closed at $4.83 billion (2021: $1.053 billion),  $96.12 billion (2021:$89.61 billion) and $27.33 billion (2021: $23.09 billion), respectively.

Equity attributable to stockholders of the company as at June 30, 2022, stood at $104.49 billion (2021: $106.75 billion) resulting in book value per share of $26.75 (2021: $27.33).